GLOBAL MARKETS-US, Europe shares fall, dlr dips on jobs data

                                

                                
 * Equities pressured on sour jobs report
                                
 * Treasuries rally with 10-year note yield at 2.86 pct
                                
 * Euro rises to $1.333 against the dollar
                                
 By Al Yoon
                                
 NEW YORK, Aug 6 (Reuters) - World stock markets and the
dollar slumped on Friday as investors fled to safe-haven assets
after worse-than-expected U.S. employment data signaled the
economic recovery was losing traction.
                                
 The U.S. economy lost 131,000 in July as more temporary
U.S. census jobs ended, and private employers added fewer
workers to their payrolls than expected in July. For details,
see [ID:nN05598486]
                                
 Investors are intensifying their focus on employment.  
"Initial market reactions signal concerns about the impact of
the poor employment picture on spending, corporate revenues,
and sustainable profitability," said Mohamed El-Erian, co-chief
investment officer at Pacific Investment Management Co in
Newport Beach, California.
                                
 "The U.S. Treasury market has been pricing in the muted
growth outlook for the U.S. associated with the stubborn
unemployment, and the equity markets are now catching up," he
added.
                                
 The lack of job growth is also seen weakening homeowner
finances and upsetting a fragile recovery in the housing
market, mortgage finance giant Fannie Mae said.
                                
 The Dow Jones industrial average <.DJI> lost 152.61 points,
or 1.43 percent, to 10,522.37. The Standard & Poor's 500 <.SPX>
dropped 18.12 points, or 1.61 percent, to 1,107.69. The Nasdaq
Composite <.IXIC> fell 38.01 points, or 1.66 percent, to
2,255.05.
                                
 The pan-European FTSEurofirst 300 index <.FTEU3> declined
1.4 percent, after rising 0.4 percent before the U.S. jobs
data.
                                
 World stocks as measured by MSCI <.MIWD00000PUS> dropped
0.6 percent, buoyed by emerging markets. The Thomson Reuters
global stock index <.TRXFLDGLPU> fell 0.6 percent.
                                
 Safe-haven bellwethers gained, with gold rising and yields
on U.S. and German benchmark bonds declining.
                                
 U.S. benchmark 10-year Treasury debt yields fell to a
15-month low, while two-year note yields dipped to a record low
after the payrolls report.
                                
 At mid-morning in New York, the 10-year yield <US10YT=RR>
was at 2.83 percent, down from 2.91 percent late Thursday.
                                
 The dollar hit an eight-month low against the yen and fell
against the euro, which hit a three-month high of $1.3333.
                                
 DOLLAR DECLINES
                                
 The jobs report "increases the odds of the Federal Reserve
having to implement fresh stimulus measures to jump-start the
recovery," said Joe Manimbo, an analyst at Travelex Global
Business Payments in Washington. "Nothing is in there to argue
for a firmer dollar."
                                
 The dollar declined against a basket of major
trading-partner currencies, with the U.S. Dollar Index <.DXY>
down 0.7 percent at 80.250. The euro <EUR=> most recently rose
0.74 percent at $1.3288.
                                
 Against the Japanese yen, the dollar <JPY=> was down 0.57
percent at 85.31.
                                
 Investors are concerned the U.S. economy is slipping back
from recovery and threatening to take the rest of the world
with it.
                                
 In recent weeks, however, investor sentiment has been
boosted by a series of generally positive earnings reports,
particularly from the financial sector.
                                
 Among the latest were part-nationalized Royal Bank of
Scotland Group PLC <RBS.L>, which reported a second-quarter
operating profit of 869 million pounds, and Europe's biggest
insurer Allianz SE <ALVG.DE>, which had stronger-than-expected
operating profit.
                                
 In commodities markets, U.S. wheat futures <Wc1> jumped
after Russia temporarily halted grain shipments in the wake of
its worst drought in a century and sparked a buying frenzy.
[GRA/]
                                
 Chicago Board of Trade (CBOT) front-month <Wc1> wheat
futures were up 1.7 percent at $7.99 per bushel. The contract
has gained nearly 90 percent since prices bottomed on June 9 at
$4.25-1/2 per bushel.
                                
 Shares of agriculture companies were active after Russia
banned wheat exports. U.S. agricultural processor Archer
Daniels Midland Co <ADM.N> rose 0.1 percent to $30.29.
                                
 U.S. light sweet crude oil <CLc1> fell 1.2 pct to $81.04
per barrel, while spot gold <XAU=> rose $13.95, or 1.17
percent, to $1208.00 an ounce.
  (Additional reporting by Jennifer Ablan, Leah Schnurr and
Steven C. Johnson in New York, and Svetlana Kovalyova in Milan;
editing by Jeffrey Benkoe)